How long does it take to get “established credit”?
Question by merciless_megan: How long does it take to get “established credit”?
I have tried to get financed for a car, but can’t because I have no established credit. So I thought it would be a good idea to get a basic credit card and just use it to build my credit. By doing this, how long would it take to get “established” credit, so I would at least have some sort of credit on my credit report? How long does it take to get good credit?
Best answer:
Answer by bdancer222
Use the credit card and pay the balance in full every month. Do not carry balances. There is absolutely no extra advantage to carry balances and making small payments. It does nothing extra for your credit. It just costs interest.
You have to use that new credit card for at least 6 months before it even counts in your FICO score. In a year, you might have a fair score, but still a very limited history and still not qualify for a car loan with good rates. It takes time to build good credit.
You will have better luck getting a car loan if you have a large down payment. Also, you might check into joining a credit union. You can usually get better rates and they are more likely to extend a loan to someone with limited credit history.
Know better? Leave your own answer in the comments!
if you have a good job, a good income, a decent down payment, you can get a car at a buy here pay here dealer, but you have to do the legwork, and you have to learn how to buy a good used car, I had no credit, and low income, I put down 1,500 (they look at your ability to save money, this is important) the larger your down payment, the nicer car you drive home, always plan to take any used car to a mechanic, to make sure it is not a hunk of crap, and if it passes the inspection but has minor problems, get them in writing with an estimate of costs to repair. then use this to negotiate the price DOWN. never ever, be in a hurry to buy a used car. patience ,patience. patience is how you get a GOOD USED CAR. usually you get stuck with a higher than normal interest rate (up to 33% ) what I did was pay down the principal as fast as possible, this will save you a lot of interest. pay off the loan, even if you have to get a second job to do it, because once paid off, you know have established credit, and the dealer will be calling you, with a much better interest rate, once they know they will get paid, they loosen up a lot. good luck this will work good, but you have to work your butt off to do it.